The FTSE traded 0.65% lower on Tuesday as weak manufacturing PMI figures out of the Eurozone and the US raised global growth concerns. Meanwhile in the UK, Brexit sees no progress as uncertainty continues to linger and registers as a global headwind alongside the unresolved US-China trade war. Today, the UK publishes construction PMI data which may impact the FTSE as it is expected to direct the pound which normally opposes the direction of London’s blue-chip index. Moreover, the FTSE may take directional cues from Wall Street as the US publishes ADP non-farm employment data. Trade and Brexit developments will remain key drivers of price action on the FTSE however risk appetite should remain subdued as yesterday’s data triggered economic concerns.
The FTSE declined by 47 points to end at 7360. The price fell below the 7400 level and found support at 7350 near the 20-period MA. The 4H RSI reading is sitting slightly above the 50 midline and a decline below 7350 would lead the index into negative territory to meet the lower support at 7320 followed by 7290. Holding above the 20-period MA would lead the index to recover some of its losses and target the higher resistance zone at 7380/7400.